Monday, October 6, 2008

Bike commuting tax break now US law

Last week we posted about the probable addition of a Bicycle Commuter Benefit to the US tax code. According to Commute By Bike , President Bush signed these changes into law on October 3rd, 2008. Details on the revisions this amendment make to Section 132(f) of the US tax code can be found in this blog entry.

Keep in mind that this benefit is something that employers can OPTIONALLY offer to their employees.

What does this all mean to you, if you are a bike commuter? It means that an employee MAY be able to receive $20 for each month that he/she uses their "...bicycle for a substantial portion of the travel between the employee’s residence and place of employment" to cover expenses. The expenses are defined as: "...reasonable expenses incurred by the employee during such calendar year for the purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is regularly used for travel between the employee’s residence and place of employment"

This tax break will not be available until 2009, so don't start saving your receipts just yet. However, you may want to start encouraging your employer to look into offering this benefit.

2 comments:

Tom said...

yeah it sounds good, but then you realize it is a tax break to employers of bike commuters. So if you work for a non-profit.... there is no break. Most small employers.... no break. Employers who don't have the time to pursue it.... no break.

I'd be interested in hearing of anyone who actually benefits from the law.

Sorry I sound so negative. But it i am sure it will never apply to me.

Biker Bob said...

I know what you mean. I'm working on my employer to get them to consider it. It's worth a try anyways.